Typical virtual currency

4.

1、 Common analysis of virtual currency (1) bitcoin solution is designed and created by Japanese programmer Nakamoto (alias) in 2009, and it is the most successful and controversial network currency at present. Bitcoin scheme is based on P2P network architecture, which has been operating in the world, and can be used for all kinds of virtual and real goods and services transactions

In theory, if the existence of network currency affects the demand for the central bank's liabilities, and then interferes with the central bank's open market operation, it will have an impact on a country's monetary policy and price stability. However, from a practical point of view, the premise of network currency affecting price stability includes the following three aspects:

(1) from the analysis of the impact on the amount of money, although it is difficult to analyze the extent to which the network currency scheme creates money in the case of lack of information

However,
however, most Internet money systems operate in prepaid mode, that is, issuing Internet money when the real money is exchanged in and withdrawing money when the real money is exchanged out. In the famous network currency scheme, the supply of money is stable and the supply is small, but we still need to be vigilant whether it can ensure that the money supply will maintain a stable level in the long run, and the impact of the change of exchange rate between network currency and real currency

(2) from the analysis of the impact on the speed of money circulation, the use of cash and money statistics, the impact of the technological innovation brought by the network currency scheme on the speed of money circulation is not clear

as an Internet instry, it largely depends on the number of active internet currency scheme users. If the network currency is widely accepted, it will have a substitution effect on the real currency of the central bank, thus recing the use of cash in transactions
in this case, the scale of the central bank's balance sheet will be reced, and its ability to influence short-term interest rates will also be weakened. The central bank will need to fight against risks through ways such as setting minimum reserves for cyber currencies. Substitution effect will aggravate the difficulty of monetary statistics and affect the relationship between monetary statistics and inflation, which is not concive to the realization of long-term price stability. In addition, the issuance of network currency outside the central bank and the expansion of virtual credit will have an impact on the central bank's interest rate decision in the economy and weaken the central bank's monetary control

(3) from the analysis of the interaction between network currency and real economy, network currency can act as a real commodity trading medium and have an impact on real GDP

The influence of network money on real money supply depends on two aspects: one is the substitution effect of virtual economy on real economy; the other is the substitution effect of virtual economy on real economy; The second is the crowding out effect of Internet money on real money, that is, with the increase of the total amount of Internet money, the amount of cash held by the public in real life decreases, resulting in the decrease of cash / deposit ratio and the increase of money multiplier. In reality, the network virtual currency scheme will not affect the price stability at this stage, and the money flow speed will not be significantly affected in the short and medium term. However, the interaction between network currency and real economy deserves attention

(2) financial stability risk when the virtual currency scheme operates outside the banking system, the most important factor of financial instability lies in its connection with the real economy, namely exchange rate and exchange market. Obviously, the closed network currency scheme and the one-way flow network currency scheme are not affected, so we should focus on the two-way flow network currency scheme. The value of two-way network currency depends on the level of money supply and demand in the exchange market. A big difference between network currency and real currency is that the network currency scheme is not based on the country or currency region, and the influence of virtual economy intensity, trade or proction capacity on its exchange rate is limited. The price of virtual money and its fluctuation depend on five factors:

(1) money supply and other actions taken by currency issuers. For example: to achieve a fixed or semi fixed exchange rate by intervening in the market

(2) the network currency scheme shows network externality, and its monetary value depends on the number of users and merchants. As the number of consumers and businesses increases, their monetary value will increase accordingly. In addition, the exchange rate of network currency with small transaction volume fluctuates more

(3) the virtual community with clear and transparent policies and advanced security measures is easier to boost confidence and the currency is stronger

(4) the reputation of network currency issuers in fulfilling their commitments. There is no "lender of last resort" in the virtual community, and the trust gained by the issuer is crucial to the exchange rate of internet currency

(5)
speculation on the future value of Internet money and cyber attacks on virtual communities. Due to the immaturity of the system, low trading, speculative activities and network attacks, the two-way network currency scheme is inherently unstable
qualitative. At present, the trading volume of these network currencies is small and the correlation with the real economy is low, so the stability of the financial system will not be affected. However, if Internet money becomes a substitute for traditional money in the future, it will bring instability to the financial system and even distort the relative prices of goods and services. The impact of network currency system on the financial system largely depends on the number of active users and the number of merchants who are willing to accept virtual currency for real transactions. In addition, virtual currency has only exchange value and no use value. Generally, network currency is not based on assets with intrinsic value and is not supported by central bank credit. At present, these network monetary systems are not allowed to lend
or borrow funds, so it can not pose a threat to the stability of the financial system, but we should pay close attention to its development. If there is any change in the future, it will undoubtedly have an impact on the financial system

(3) stability risk of payment system

in a specific virtual community, virtual currency payment activities have evolved into a "real" payment system, facing typical risks related to the payment system: credit risk, liquidity risk, operational risk and legal risk. The nature, scale and ration of these risks are largely determined by the design of the system or the degree of lack of liquidity, so it is difficult for the network virtual currency scheme to avoid or control these risks. According to the core principles of payment system (CP) issued by the bank for International Settlements (BIS), the network virtual currency scheme does not conform to most of the contents of CP, and does not belong to the systemically important payment system. Therefore, it will not cause
or transmit shocks in the global financial system. At present, there is no systematic risk in the network currency system outside these virtual communities

2. Lack of corresponding supervision and protection mechanism

in the real economy, the central bank plays the role of lender of last resort and has no default risk, so it can take actions in the case of payment crisis or unpredictable liquidity shortage to avoid chain reaction. However, in the network virtual currency scheme
it is impossible to use network currency as settlement asset. Because network currency simply depends on the credibility of the issuer, it can not be widely accepted as a means of payment, so network currency can not be regarded as a safe currency. In addition, commercial banks are required to accept prudential supervision, which reces the possibility of default, and the security of money in commercial bank accounts is higher than that of network currency. A fundamental risk of network currency is that the settlement institution of network currency scheme is not subject to any supervision, no institution is responsible for its behavior, and there is no investor / depositor protection mechanism, which causes the user to bear all the risks

(4) risk of absence of supervision generally speaking, supervision lags behind the development of science and technology. The network virtual currency program was established in the late 1990s, but it was not until 2006 that some government agencies in the United States began to analyze these programs. Due to the lack of
supervision and the anonymity, invisibility and difficulty in tracking of its transactions, the network virtual currency scheme is very easy to be used by terrorist activities, fraud, money laundering and other illegal activities. At present, many government departments in many countries are considering whether to recognize or
legalize these virtual schemes and bring them into the scope of supervision, so as to support the innovation of currency and payment forms, protect the rights and interests of consumers and financial stability, and inhibit the use of virtual currency schemes to engage in criminal activities
at present, the uncertainty of the legal status of the virtual currency scheme may also bring challenges to the government authorities

(5) reputation risk of monetary authority the reputation of Monetary Authority (central bank) is the key factor to determine the effectiveness of monetary policy. The public's trust in fiat money is closely related to the image of the central bank, which pays close attention to its reputation. The ECB defines reputation risk as the risk of deterioration of reputation, credit or public image. As the network currency scheme is related to money and payment, it is generally believed that it belongs to the responsibility of the central bank, so we should be alert to the reputation risk it may bring to the central bank. However, in the case of small scale, the impact of the failure of the network currency scheme is limited, but its high volatility and instability also aggravate the possibility of failure and attract extensive media coverage. If the network currency is allowed to develop continuously without
regulation, the central bank may be considered as dereliction of ty and affect its reputation

(6) the risk of investors' loss
for exchange value, the public has a higher recognition of the investment value of network virtual currency, and it is investment based transactions that accelerate the formation of virtual currency market. Like other investment markets, participants in virtual money market will also face potential losses caused by market risk, credit risk and policy risk. Take bitcoin as an example: from 2009 to early 2010, bitcoin was worthless; In the summer of 2010, bitcoin trading began to enter the golden
period. As the supply was far less than the demand, the value of online trading began to rise. In early November, bitcoin was silent at 29 cents for many days, and then jumped to 36 cents; In February 2011, bitcoin continued to appreciate, and its exchange rate with us dollar
reached 1:1; In 2013, the price of bitcoin achieved a "Big Bang" growth, and hit US $1242 on November 29, 2013, surpassing the gold price of US $1241.98/ounce in the same period. Fierce price fluctuations make market participants face huge speculative risks. Unlike mature capital markets such as stocks and bonds, the depth of bitcoin market is insufficient, and it is mainly held in the hands of large investors with low degree of diversification. Bitcoin price is easily affected by large investors' buying and selling behavior, and also easily manipulated by speculators. At the same time, different countries have different attitudes towards bitcoin, Germany, the United States and other countries hold an open and supportive attitude, and Thailand, Brazil and other countries regard bitcoin related activities
as illegal. Every country's attitude and measures will have a significant impact on the price of bitcoin, especially in the short term

virtual currency is always inferior to real currency< br />

5. As a typical representative of virtual currency, bitcoin's fall has directly or indirectly affected related instries. The news of players' wealth shrinking and mining machinery selling by Jin emerge one after another. As investors become cautious about virtual currency investment, the market is in a downturn. Facing the sluggish market, players can not see the hope of investment, so it is inevitable that virtual currency has no future. However, there are also players in low-key bottom hunting, that bitcoin led virtual currency, has great investment value< br />
The essential value of any kind of currency is that it can be used as the value scale to measure other things and has stability. The virtual currency here is not game currency, but a digital cryptocurrency like bitcoin. The bottom layer uses blockchain technology, which has the characteristics of decentralization, information tampering and anonymity. At present, cryptocurrency headed by bitcoin can not bear the property of currency. It is not fair to conclude that there is no value

a consensus has been reached in the currency circle by default, that is, bitcoin is similar to diamonds in the real world. The value of diamonds is given by businessmen, and it has been agreed that diamonds can symbolize love and have practical properties. Mining diamonds and gold also need to consume a lot of costs, but it is because a lot of costs are consumed that the constant intrinsic value of diamonds and gold can be ensured. The resources that can be obtained casually are prone to inflation< br />
The fall in 2018 makes investors return to rationality, which is actually concive to the standardized development of the currency circle. Now, regardless of the practical value of digital currency, this capital harvest makes investors further understand the importance of risk management. Money circle and Internet Finance allow investors to see that they are profitable, so they don't have to think about investing in it. It is ultimately their own loss. Whether this bear market can make investors understand the essence of money circle is still unknown. However, the future development of the coin circle still needs government regulation, as well as the regular operation of platforms and projects. Of course, only with the support of capital can the coin circle develop healthily and systematically. Therefore, capital outflow is the biggest reason for bitcoin's sharp decline.

6. The price of bitcoin is determined by the market. If it's a bit mysterious, it's the result of fighting among various forces: the makers and the retail investors, the bulls and the bears. Moreover, the market is 7 * 24, with people or trading robots operating at fixed points sooner or later. The price fluctuation is very normal

the sudden rise and fall on this day may indicate what happened in the primary market. You can pay attention to the news, and the makers like to operate through the news, which depends on your investment level< br />

7. There are too many virtual currencies that can dock with bitcoin. Basically, all virtual currencies can dock with bitcoin
but in many cases, bitcoin has become a pyramid selling tool, such as MMM financial mutual aid, Morgan, Baichuan, Vicat and so on. They all carry out pyramid schemes under the guise of bitcoin. They are all typical pyramid schemes
however, some projects use bitcoin to boost their own virtual currency projects, such as shaqiantong project and Fuyuan coin project. They all take bitcoin as a typical example for research and development.

8. Monetary system is the general term of the rules, structure and organization system of currency circulation stipulated by national laws

the monetary system is graally proced and developed with the development of commodity economy, and formed a relatively standardized system in modern times. Its basic elements include:

① monetary metal. That is to say, the law stipulates which kind of metal should be used as the base currency, which is actually the objective requirement of the development of commodity economy and is determined by the level of proction and the degree of development. Historically, it has experienced a process from silver standard system, gold and silver plicate system, to gold standard system, and then to non cash standard system< (2) monetary unit. That is to say, the name and gold content of money are stipulated by law< (3) the system of currency casting, printing, issuing and circulation< (4) monetary reserve system. That is to say, the central bank or the government should reserve certain precious metals and foreign exchange in order to ensure the stability of currency. After the 1930s, countries graally abolished the gold standard. After the Second World War, capitalist countries generally adopted the surplus exchange standard system with us dollar as the main reserve currency. At present, countries all over the world are practicing the non cash credit monetary system, namely the non cash standard system. There are two kinds of monetary systems in history, metal standard and paper currency standard< (1) gold standard

gold standard refers to the monetary system with gold as the base currency. Its main forms are gold coin standard system, gold nugget standard system and gold exchange standard system< The gold standard system is a typical gold standard system with gold as monetary metal. Its main features are: gold coins can be cast and melted freely; The secondary currency and value symbols (such as bank notes) in circulation can be exchanged for gold coins freely; Gold can be freely exported and imported. In the implementation of the gold standard between countries, according to the gold content of the currencies of the two countries to calculate the exchange rate, known as the gold parity< The gold standard system refers to the monetary system in which paper money is issued by the central bank and prepared with gold. It differs from the gold standard system in the following aspects: first, the gold standard system takes paper money or bank notes as currency, and no longer casts or circulates gold coins, but stipulates the gold content of paper money or bank notes, which can be exchanged for gold; Second, the government is required to concentrate gold reserves, allowing residents to exchange gold bullion when the gold content of the standard currency reaches a certain amount< 3. Gold exchange standard system is a monetary system in which bank notes are used as currency in circulation and gold is indirectly exchanged through foreign exchange. The similarities between gold exchange standard and gold nugget standard lie in the stipulation of gold content in monetary unit, the circulation of bank notes in China, and the circulation of seigniorage. However, bank notes can be exchanged for foreign exchange, not gold. The Central Bank of China deposits gold and foreign exchange in another gold standard country, allows the indirect exchange of foreign exchange for gold, and regulates the legal ratio between the national currency and the national currency, so as to stabilize the value of the local currency< 4. Bretton Woods system

governments link their currencies to the US dollar to set exchange rates, so that their currencies are indirectly linked to gold. In this arrangement of international monetary system, the US dollar is in a key position equivalent to gold relative to the currencies of other member states. Therefore, this system is also known as the international monetary system centered on the US dollar< (2) silver standard

Silver Standard refers to a monetary system with silver as the base currency. In the evolution of monetary system, the history of silver standard is earlier than that of gold standard. The operation principle of silver standard is similar to gold standard, the main difference is that silver is used as the standard currency. The nominal value of silver coin is consistent with the actual value of silver. Silver standard can be divided into silver standard and silver standard< (3) the system of compound position means that a country stipulates gold and silver as the standard currency at the same time. Under the plex system, gold and silver can be freely traded, cast and melted, exported and imported, just as under the gold standard or silver standard< On the surface, it can make the standard currency metal have more sufficient sources, and make the quantity of money better meet the needs of the expanding commodity proction and exchange, but in fact it is a kind of monetary system with inherent instability

the phenomenon of "bad money drives out good money", that is, when the market value of gold and silver is higher than the official price, they will be collected by people, and the "precious" metal of gold and silver will eventually withdraw from circulation, which makes the plicate system impossible. This phenomenon is called "Gresham's law"“ The fundamental reason of "bad money expels good money" lies in the contradiction between the double standard of gold and silver and the exclusive and exclusive nature of money as a general equivalent< (4) the standard system of paper money

1. The standard system of paper money is also called credit standard system, because from the perspective of national law, it is no longer necessary to use metal money as the issuing preparation< 2. The main feature of the paper money system is that the paper money and bank deposits perform the monetary function in circulation

3. Paper money creates conditions for the government to influence economic activities by adjusting the amount of money

4. There have been different arguments about the paper money system since its implementation< Those who advocate the restoration of the gold standard believe that only by making money convertible into gold can we restrict the government's hasty behavior on a material basis and urge the government to act cautiously. Those who agree with the paper currency standard system think that in today's economic society, the change of money supply has a wide impact on the economy, and the government has become an indispensable part of economic policy by changing the money supply to achieve the predetermined economic goals.